Sally Uren unveils the future of consumerism, circa 2020.
When you walk into a shop, what’s the very first thing on your mind?
Are you thinking: “Right, I need to decide just how sustainable this toaster, or jacket, or apple is”...? Well, maybe, if you’re one of the few percent who put environmental and ethical concerns right at the top of their shopping list.
“Brands have to take sustainable shopping into the mainstream”
But for most of us, sustainability is just one of a whole tangle of considerations we wrestle with when making purchasing choices – along with price, quality, style and many more. Most people would like to do the right thing, but we don’t always know how to go about it. Meanwhile, the pressure to keep acquiring more stuff is ever present. In the tuneful words of Lily Allen:
“I am a weapon of massive consumption,
It’s not my fault, it’s how I’m programmed
So how do we get sustainable shopping out of the eco-niche and into the mainstream? That’s not just a challenge for environmentalists. It’s one for leading retailers and brands, too. They know that addressing issues from climate change to food, water and energy security will need dramatic shifts in consumption patterns and consumer behaviour in the coming years. This can’t be left to the whim of individual shoppers. Responsible brands have to play their part. And that means finding new ways to deliver quality products and services to demanding consumers in a world bumping up against natural limits.
Knowing what that means in practice is far from easy. Brands are used to drawing on recent market data and near-term market projections to help develop products and services, but this tends to encourage only incremental change. However, if they shift their focus ahead to 2020, and consider what kind of world they will be operating in, they can start to grapple with the scale of changes needed. And they might even find they can help shape that future along more sustainable lines.
What will the world look like in (just less than) a decade’s time? As Niels Bohr acidly commented, “Prediction is notoriously difficult – especially about the future.” So ‘Consumer Futures’ deploys a range of four very different possible scenarios as a way of helping stimulate thinking about how things might unfold. But there are some aspects in common: realities which, our research suggests, will be inescapable features of 2020. Here’s what we can, grimly, count on.
Global population will have ballooned to around 7.6 billion. Climate change impacts will be increasingly in evidence, and starting to disrupt global supply chains. We are also fairly certain that the cost of key resources such as wheat, oil, water and energy will continue to rise as demand grows and supplies fail to keep pace. We will be living in a resource-constrained world. All of which means that the fundamental imperatives of sustainability will still apply – but with bells on. We will need sustainable consumption more than ever. So, just what exactly is this elusive creature? In essence, it can be summed up as follows:
- Smart growth. Economic prosperity is not delivered at the expense of the environment, and the overall footprint of business is shrinking, not expanding. Smart growth is characterised by ‘decoupling’ commercial success from environmental impact, typically by delivering more economic value per unit of resource consumed. An example? Electric cars, recharged by solar power, which can also double as a means of balancing supply and demand fluctuations in the grid.
- Smart use. Products create as little impact as possible at all stages of their life, from manufacture to disposal: nothing goes to waste. So, smart use is characterised by closed loops (where the materials get reused to make new products), or even open loops (where someone’s waste is another’s raw material). Take-back schemes abound, with everything from shampoo bottles to clothes being scooped up by retailers for resale. It’s the opposite of a throwaway society. Early movers include outdoor gear retailers Patagonia, who already take back clothing for remanufacture, and are now encouraging customers to ‘buy less, buy to last’. A smart use approach also encourages a shift from selling products (a disposable nappy, for example) to services (such as one providing a regular supply of freshly laundered nappies). And it nurtures different ownership models, too: you don’t need to possess something in order use it. We can already see the first signs of that in the spread of car clubs.
- …and a positive social impact. A future of smart consumption will be one in which what, and how, we buy promotes lasting wellbeing – in ourselves, and in everyone involved in producing our purchase, all the way down the supply chain. This doesn’t just mean ensuring decent working conditions for producers and a minimal environmental impact. It could also change the nature of what we buy, too.
There’s plenty of evidence that simply acquiring more and more ‘stuff’ doesn’t make us any happier. And as inequalities grow, it certainly doesn’t promote community cohesion. In fact, analysis of the recent riots in the UK tells us that the pursuit of shiny stuff can be an indication of communities in distress. So, in a sustainable future, we might find that the endless search for novelty and the implied personal status that goes with it are far less important than they are today. Instead, we could find ourselves buying local food from inner-city vertical farms, say, which provide jobs for our unemployed neighbours and fresh veg for our children’s school.
So, armed with all this analysis and future-gazing, what should leading businesses be doing today to prepare for a ‘smart consuming’ future?
First, they should be flexible: tomorrow is not going to be ‘today plus’. Innovative companies, alive to new business models, will be the ones that prosper. This might involve shifting from selling products to services, giving consumers access to what they need without the material ownership. It might also mean developing a much more ‘closed loop’ approach – sustaining a long-term relationship with customers, rather than simply selling something to someone once.
Some of the changes highlighted in our scenarios could pose formidable challenges to the old way of doing things. Take the shift to more local consumption: a feature of the scenario ‘From me to you’. In a world where people buy directly from producers, for example, what will be the role of retailers, whether online or operating bricks and mortar stores?
Second, smart businesses will realise they cannot crack this alone. In a world where resource scarcity is increasingly prevalent, they’ll need to work much more closely with the whole value chain. That means farmers, producers, suppliers, designers, retailers, and the consumer. In two of the scenarios, long linear supply chains which criss-cross the globe have been superseded by shorter, more local ones: the boundaries between the producer and consumer have blurred, so we can expect more circular and sometimes simpler value chains. All of which means that new partnerships will be vital to business success.
Which leads on to the third recommendation: to strengthen local brands, and local production capacity. We’ve become so used to the idea of globalisation as an unstoppable force that to suggest a change of course may come as something of a shock. But there is no guarantee that global brands will continue to win hearts and minds. In two of our scenarios, communities have built up their own, more resilient systems to source the products and services they need. In ‘My way’ they club together to buy direct from producers to save money; while peer-to-peer exchange and trade networks are a feature of ‘From me to you’.
Even in the absence of consumer demand for locally resonant brands, strengthening local production will still make sense, as it reduces the risk of supply chain disruption from resource shortages and climate impacts. It all points in favour of businesses diversifying their brands to embrace this trend, giving products and services a local, authentic story which will resonate with consumers and strengthen the local economy.
Then there’s transparency. We’re already familiar with a world where, thanks to the spread of social media and IT generally, companies find it harder to hide. In the future, they’ll find it harder still. Each of our scenarios sees a time where ‘green’ and ‘ethical’ are no longer niche, and robust standards on environmental and social performance are mainstreamed into everyday products and services. This is a world where skeletons simply won’t stay in the closet. A mix of tight product regulations, and growing consumer savviness, will favour those companies who freely open up their supply chain to scrutiny.
Finally, we recommend that smart businesses start to use their brightest marketing and communications people to prepare the ground for a world where sustainable consumption is the norm. Some brands are beginning to have conversations with consumers on the sustainability agenda, but that tends to focus on today’s issues: too many marketing teams use yesterday’s insight data to make decisions about what tomorrow’s consumers will want. More savvy brands will look to steal a march on the opposition by helping create a demand now for the sort of new products and services outlined above which will become the norm in a decade or so’s time.
To sum up, you cannot overestimate the role which today’s dominant brands will play in helping make consumption sustainable. Many brands have built up a loyalty from millions of consumers which often lasts a lifetime. This gives them both the power and the responsibility to help these people lead more sustainable lives. In fact, it’s hard to see sustainable consumption becoming mainstream – unless brands take the lead.
Any attempt to describe the landscape against which consumption will take place in 2020 has to acknowledge some pretty major uncertainties. Just where will the consumer be on sustainability? Willing to make lifestyle and consumption choices that reduce environmental impacts, or expecting brands and retailers to do it for them? What will the regulatory landscape look like? Will there be a global agreement on climate change? Or will the market rule our response? Will we be at peace or war? And will economic growth have returned to the developed economies, or will these still be flat-lining?
Our four scenarios tease out different plausible futures across this spectrum, each of which has its own consumer culture – and its own approach to more sustainable consumption. None of these are nirvana – nor are they a dystopia either. There are pluses and minuses to each.
‘My Way’ is a high-tech world, in which smart products promote patterns of consumption that use less energy and water and generate less CO2. Much fresh produce comes in smart packaging that keeps it refrigerated, and changes colour when it passes the use-by date. Online micro-energy managers keep our homes optimally configured to smooth out our power use and keep our bills to a minimum, switching off the fridge for half an hour, pausing the car recharge until demand has peaked, and making sure our solar watts trickle into the grid at just the right time to get maximum rewards.
‘Sell it to me’ is a personalised consumer world dominated by brands. We might be fitting our homes with brand-sponsored bathrooms that provide us with personalised supplies of toiletries on demand. It sounds like an Orwellian nightmare, but such slavish brand loyalty could be a route by which business can fine tune its offering to provide just what each individual customer needs, exactly when they need it, at minimum cost in terms of resources. It’s a closed loop economy, too: everything’s taken back for reuse or remanufacture; nothing goes to waste.
‘From me to you’, by contrast, is a world where communities, collaboration and innovative business models are the key to a low-carbon lifestyle. With resource prices spiralling, global tensions on the rise and trust in government fading fast, there’s little alternative. Peer-to-peer lending exchanges are common, and we see property owners banding together to loan money for mortgages. With many food imports prohibitively costly, this is a grow-your-own world: community-owned farms flourish, and repair and ‘remaking’ workshops spring up in the shells of bankrupt malls.
Finally, ‘I’m in your hands’ is a tightly regulated world in which consumers trust brands to provide what’s best for them and for the environment – and trust the government to make sure that they do so. Resource constraints and tough carbon targets help create a culture of willing conformists. It’s brought about an economy where services, as opposed to products, are the stuff of commerce. Rather than buy things, like fridges, food and clothes, people lease services which guarantee their beer will be cold, their diet healthy and tasty, and their bodies clad in the right mix of fashion and functionality, whatever the season. Innovative products provide personal health solutions: our clothes are impregnated with vitamins; our shampoo lather changes colour to indicate mineral deficiencies.
To explore the scenarios in full, discover how to use them in practice, and see how Suzy our consumer archetype sources her shampoo in a range of possible 2020s, visit: http://www.forumforthefuture.org/project/consumer-futures-2020/overview
Sally Uren is Deputy Chief Executive of Forum for the Future.
Photos: Eileen Bach/Lifesize/Thinkstock; Vertical Farm Project; BDS/Thinkstock